Where did it all go wrong for the beer they call 'wife beater'? | Daily Mail Online Where did it all go wrong for the beer they call 'wife beater'? By VICTORIA MOORE Last updated at 17:54 15 November 2007 You know how depressing it is when the local you've happily been sinking pints at for years suddenly seems to be going downhill? Well a few months ago, landlord Dave Edwards of the Rose & Crown in Worthing on the South Coast began to notice that was exactly what was happening to his own pub. As his bar manager, a man who doesn't mince his words, puts it: "We're a nice place with nice, often more mature, customers. We have a Thai restaurant in the evenings, and they come for a quiet drink and something to eat. "Then suddenly - I'm not a snob - but we started getting all these loudmouthed yobs in. Younger drinkers, 19 to 30-year-olds, and builders and labourers. Scroll down for more...

"They weren't fighting - we'd never have let things get to that stage - but they were creating, and it was bad enough to make the other customers start leaving early." Dave noticed that besides being trouble, all these "rogue elements" had something else in common. When they asked for "the usual", it always meant the same thing: a pint of Stella Artois. "With Stella, we got a minimum amount of drinking and a maximum amount of aggravation," says Dave. "It didn't appear to be a social drink and seemed to have an adverse effect on people. Everyone who was drinking Stella was a pain." His solution was blindingly simple. He cancelled his order for Stella Artois and replaced it with another lager, San Miguel. Within a matter of weeks, the rowdy crowd had found somewhere else to drink and it was business as usual at the Rose & Crown. Everyone, it seemed, was happy. Well perhaps not quite everyone.

For InBev, the company which owns the enormously successful and profitable beer, this incident was further worrying proof that Stella Artois, once best known for its unashamedly upmarket advertising slogan, "reassuringly expensive", has, as a member of the drinks trade phrases it, "done a Burberry" - the fashion house which became the designer label of choice for football thugs. In short, it has gone from being a product with a certain degree of class to one associated with all the wrong sort of people. Despite heavily discounted prices, sales of Stella Artois in Britain have slumped recently with take-home sales down five per cent. Perhaps this is not surprising when own-brand supermarket lagers are now cheaper even than mineral water at an astonishing 22p per can. But Stella's owner is now trying to fight back with a new multi-million pound advertising campaign. It has dropped the "reassuringly expensive" slogan ("but only for the time being," insists a spokesman), and is attempting to reposition the lager with a Continental set of ads that doesn't mention "Stella" at all. "It would be naive to say no [there isn't an image problem]," admits a spokesman for InBev.

Scoll down for more... Image problem? Just a bit! The drink, which at 5.2 per cent alcohol is stronger than many other lagers and therefore makes people drunker and sometimes more aggressive more quickly, has acquired the unflattering soubriquet of "wife beater". "I first heard someone refer to it as that two or three years ago," says Zak Avery, a beer trade commentator who owns a specialist off-licence in Headingley near Leeds. "I think that to use a term like that laughingly as a nickname for a beer is crass. But it seems to happen. "It comes from the people they refer to in America as "poor white trash", or "trailer trash", and there's a particular item of clothing, a white sleeveless vest, that gets called the "wife beater vest". "The sort of person who might live that lifestyle, and wear that top, was co-opted to describe the average Stella drinker - though I should stress it's not something I necessarily believe is fair." None of this is compatible with the sophisticated and upmarket image that Stella has tried to push, using TV ads with such high production values they look like expensive art-house mini-movies.

Or with their sponsorship of the tennis tournament at Queen's Club in London, which is a warm-up for Wimbledon. Tap the words "Stella Artois" and "wife beater" into an internet search engine, though, and you'll see just how commonly used the nasty nickname is. "Me and my partner used to drink Stella all the time - and every time we'd end up in terrible arguments," offers one (female) correspondent on an internet discussion board. "4 years ago we decided to drink a lighter beer and eversince [sic] we have not argued like back then." Another adds: "My parents run a pub and they stopped selling Stella for the reasons above. It is even called wifebeater in the trade!" And yet another: "I used 2 drink stella and all it does is make me and the mrs argue and i've hit her a few times which im ashamed of." Meanwhile, one drinker said he was convinced the drink sent "mental messages round my brain". Of course, it is ridiculous to suggest that any particular drink, rather than people's excessive consumption of it, might be to blame for violence. But the cultural association is far from being just a bit of pub and internet chat.

In the courts, lawyers are sadly familiar with the Stella phenomenon. Barrister Alex McBride says: "The people I see coming into court who are up for charges of GBH are, by and large, young men who have drunk an awful lot of strong lager. "I'm not saying that means they've drunk Stella, but, more often than not, it does tend to be Stella." Others claim Stella seems to have become the drink of choice for those who go out and "glass each other". And as criminal defence lawyer Greg Foxsmith told BBC's Newsnight: "One rarely hears the same thing with other brands that I can mention." The lager was even singled out by a judge in a Brighton court, who linked it with binge-drinking and alcohol-fuelled violence when sentencing a man who had attacked his ex-girlfriend's partner after downing Stella Artois. "For people who sit where I do, there are key words in the papers for this case which occur all too frequently in cases involving young men and alcohol," said recorder John Hardy.

"They are "Stella" and "binge-drinking"." When the Mail contacted Mr Hardy this week, he declined to comment further: "The observations that I made in court were relevant to the particular case with which I was dealing." Given the rate at which Stella outsells its rivals, perhaps it is inevitable that its name will crop up more frequently in cases that involve alcohol and violence. But with the Stella name now so tarnished, no wonder its parent company told the Mail it has decided to withdraw it from some (presumably less desirable) establishments - even if the official reason given for this is that "the pouring ritual is not being observed correctly". For those familiar with its reputation, the idea of asking for a "pint of Stella please, mate" is rapidly becoming about as appealing as the idea of ordering the down-and-out's favourite, a pint of Special Brew. So where did it all go wrong? For the past decade, the Stella Artois brand has been one the most commercially successful beers in the country.

Initially marketed as a premium, ever-so-stylish French lager (even if it was actually Belgian) aimed at the upmarket drinker, it rapidly became "a success story beyond anything the beer trade had seen", says Graham Holter, editor of Off Licence News. The advertising campaign was hugely successful in increasing awareness of the brand. And this was soon coupled with huge price promotions. Despite the "reassuringly expensive" tagline, Stella Artois is very often anything but. Says one advertising executive who used to work on the brand: "Stella Artois soon became widely available in supermarkets and off licences, where it was - and still is - often discounted." While the advertising sought to position the brand upmarket, the discounting had the opposite effect and attracted the sort of customer who was good for sales but certainly didn't fit the profile for a high quality product. "It has become a victim of its own success," says brand expert James Osmond, a director at consultancy Clear. "This often happens when a brand gets so enormous that it tries to appeal to everyone. Either it becomes ubiquitous and begins to lose credibility.

Or it's bought by the wrong type of customer." It was the relatively high 5.2 per cent alcohol content that encouraged the binge-drinkers and led to lager becoming something you'd order "if you were really out on the lash", as one drinker, estate agent Martin Abel, puts it. "It became something a bit naughty," he continues. "I'd order a pint of Stella rather than another beer because I'd know it would get me more revved up." Chris Canning, a plumber from Bethnal Green, East London, concurs. "It gets you smashed, doesn't it? Me and the lads have it when we're on a big night." And so Stella began to acquire a reputation as a drink for those whose stated mission was to get blind drunk. Understandably, Stella's owner now wants to shed this downmarket image. Its new advertising campaign strives to position it as part of the "Famille Artois" - a family of three beers sold alongside each other under the Artois umbrella.

As for the pedigree, it claims the pale gold pilsner lager, made with Saaz hops, was first brewed as a Christmas beer in Leuven, a Belgian city with an elaborate Gothic town hall, and that "it was named Stella from the star of Christmas, and Artois after Sebastian Artois, founder of the brewery". But there is some controversy over the precise history of the Stella brand. Earlier this year, the advertising watchdog banned the brand from implying in its adverts that one family had been brewing the beer for more than 600 years. A spokesman still insists it can trace its history back more than six centuries, as it was first brewed in 1366 and is still made "in the same way, perhaps with the odd technological advancement". And where is it made today? "It's all made in Leuven," explained a spokesman. All of it? "Yes, except for the stuff we drink in this country, and that's made in Wales." The owner, InBev, is doing its level best to distance itself from the wifebeater moniker. "Successful brands are often blamed for social problems," says the spokesman.

"In reality, the minority who cause problems due to excessive drinking are an issue for society as a whole." InBev also points out that the number of establishments selling Stella Artois has risen by 500 in the past year. But given the experience of the Rose & Crown in Worthing, perhaps a few other landlords might now be considering calling time on it. The Plot to Destroy America's Beer - Bloomberg Bloomberg the Company & Its Products Bloomberg Anywhere Remote LoginBloomberg Anywhere Login Bloomberg Terminal Demo Request Bloomberg Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world. Customer Support Advertising Bloomberg Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world. Customer Support The Plot to Destroy America's Beer AB InBev is gobbling up the world's beers—and drinkers aren't happy by More stories by Devin Leonard Photograph by Jamie Chung for Bloomberg Businessweek Brian Rinfret likes imported beer from Germany. He sometimes buys Spaten. He enjoys an occasional Bitburger.

When he was 25 years old, he discovered Beck’s, a pilsner brewed in the city of Bremen in accordance with the Reinheitsgebot, the German Purity Law of 1516. It said so right on the label. After that, Rinfret was hooked. One Friday night in January, Rinfret, who is now 52, stopped on the way home from work at his local liquor store in Monroe, N.J., and purchased a 12-pack of Beck’s. When he got home, he opened a bottle. “I was like, what the hell?” he recalls. “It tasted light. It tasted weak. Just, you know, night and day. Bubbly, real fizzy. To me, it wasn’t German beer. It tasted like a Budweiser with flavoring.” He examined the label. It said the beer was no longer brewed in Bremen. He looked more closely at the fine print: “Product of the USA.” This was profoundly unsettling for a guy who had been a Beck’s drinker for more than half his life. He was also miffed to have paid the full import price for the 12-pack.

Rinfret left a telephone message with AB InBev, the owner of Beck’s and many other beers, including Budweiser. Nobody got back to him. He had better luck with e-mail. An AB InBev employee informed him that Beck’s was now being brewed in St. Louis along with Budweiser. But never fear, the rep told Rinfret: AB InBev was using the same recipe as always. He wasn’t satisfied. In March, he posted a plea on Beck’s official Facebook page: “Beck’s made in the U.S. not worth drinking. Bring back German Beck’s. Please.” He had plenty of company. “This is a travesty,” a fellow disgruntled Beck’s drinker raged. “I’m pretty bummed,” wrote another. “I’ve been drinking this beer religiously for over 20 years.” Rinfret kept trashing Beck’s on Facebook. Until, he says, AB InBev unfriended him in May. “They banned me from their site. I can’t post anything on there any longer.” Rinfret was only temporarily silenced. He now complains on a Facebook page called Import Beck’s from Germany.

AB InBev may be paying a price for disappointing Beck’s loyalists like him. According to Bump Williams, a beer industry consultant in Stratford, Conn., sales of Beck’s at U.S. food stores were down 14 percent in the four weeks ending Sept. 9 compared with the same period last year. “They are getting their proverbial asses kicked,” Williams says. “Too many customers were turned off when the switch was made.” Sales of Budweiser in the U.S. have fallen recently, too. And yet AB InBev is extraordinarily profitable. There has never been a beer company like AB InBev. It was created in 2008 when InBev, the Leuven (Belgium)-based owner of Beck’s and Stella Artois, swallowed Anheuser-Busch, the maker of Budweiser, in a $52 billion hostile takeover. Today, AB InBev is the dominant beer company in the U.S., with 48 percent of the market. It controls 69 percent in Brazil; it’s the second-largest brewer in Russia and the third-largest in China. The company owns more than 200 different beers around the world.

It would like to buy more. The man in charge of AB InBev is 52-year-old Carlos Brito. The Brazilian-born chief executive is a millionaire many times over. He speaks English fluently and dresses like the manager of a local hardware store. At the Manhattan headquarters, he wears jeans to work and tucks in his shirts. He keeps his company identification badge clipped to his waist where everybody can see it, even though everyone knows who he is. To the rest of the world, he keeps a low profile. He does not, for example, accept interview requests from Bloomberg Businessweek. That might be his character, and it might be calculated. The Busch family is a legendary American dynasty. Many people in the U.S. aren’t thrilled that a foreign company now owns Budweiser, America’s beer. This is not to say that Brito lacks American admirers. Many can be found on Wall Street, where investors care less about where beers are brewed than about how profitable they are. This is where Brito shines. After InBev bought Anheuser-Busch, he slashed costs at the combined company by $1.1 billion in a single year.

AB InBev’s margins widened substantially, and its share price has nearly quadrupled since the takeover. In 2011, Brito made Fortune magazine’s Fantasy Sports Executive League Dream Team as a designated hitter. Anthony Bucalo, an analyst for Banco Santander, speculated in April that Brito’s ultimate plan is to acquire the beverage unit of PepsiCo. AB InBev already distributes PepsiCo’s soft drinks in Brazil, and it was through a distributor’s arrangement that the company got its claws into Anheuser-Busch. According to Bucalo’s theory, Brito wants to be the king of sparkling beverages in aluminum cans, regardless of their alcohol content or taste. There’s one hitch. AB InBev’s CEO is a skilled financial engineer, but he has had trouble selling beer. The company’s shipments in the U.S. have declined 8 percent to 98 million barrels from 2008 to 2011, according to Beer Marketer’s Insights. Last year, Coors Light surpassed Budweiser to become America’s No. 2 beer. (Bud Light remains No. 1.) Meanwhile, Brito is alienating lovers of AB InBev’s imports by not importing them.

And he’s risking the devotion of American beer lovers by fiddling with the Budweiser recipe in the name of cost-cutting. On Oct. 3, Brito showed up at the presidential debate at the University of Denver. Uncharacteristically, he wore a suit and tie. He made small talk with reporters but left it to others to make headlines. “There is no way he would say anything newsworthy,” says Harry Schuhmacher, editor of Beer Business Daily, who attended the debate as Brito’s guest. “My nickname for him is La Máquina, which is Portuguese for the machine.” Schuhmacher knows Brito as well as any journalist. They’ve had lunch; they’ve had beers. Schuhmacher always comes away with a sense of puzzlement. “He’s given me a 15-minute explanation of something,” Schuhmacher says. “Then I’ll transcribe it. It’s verbatim the same explanation he gave to the Wall Street Journal. I’m like, how does he do it? He stays on message. He’s masterful at it.” Born in 1960, Carlos Alves de Brito studied mechanical engineering at the Federal University of Rio de Janeiro.

He wanted to get an MBA from an American school, but he couldn’t afford the tuition. Through a family friend, Brito met Jorge Paulo Lemann, a wealthy Brazilian banker. The two were well matched. According to a Brazilian business magazine, there were two ways that an employee of Lemann’s bank could quickly be shown the door. One was to appear in the Brazilian celebrity magazine Caras. The other was to purchase a foreign car. (Lemann and his partners sold their bank to Credit Suisse in 1998 for nearly $1 billion.) Lemann thought Brito had potential. He agreed to pay for him to get an MBA at Stanford University. When Brito graduated in 1989, he went to work at Brahma, a Brazilian brewery where Lemann was a director and controlling investor. Brito became the company’s sales manager, overseeing its army of representatives, many of whom traveled by motorbike. In 1999, Brahma merged with another brewer, Antarctica, to become AmBev, Brazil’s biggest beer company. In 2004, Brito became CEO, and the chief evangelist for his mentor’s frugal corporate values.

That year, AmBev merged with Belgium’s Interbrew, owner of Beck’s and Stella Artois, to create InBev. The deal gave the Brazilians legitimacy in the international beer industry. They were now part of a company with brands that were centuries old. The CEO of the new company was John Brock, an Interbrew holdover. Within a year and a half, Brito and his Brazilian management team were in charge. InBev was never a sentimental company. Shortly after the merger, it shuttered the 227-year-old brewery in Manchester, U.K., where Boddingtons was produced. It encountered more resistance in 2005 when it closed the brewery in the Belgian village of Hoegaarden, from which the popular white beer of the same name flowed. InBev said it could no longer afford to keep the brewery open. After two years of protests by brewery workers and beer aficionados, it reversed itself. Laura Vallis, an AB InBev spokeswoman, says Hoegaarden exports spiked unexpectedly. “The brand’s growth since is positive news for Hoegaarden and for consumers around the world who enjoy it,” she says. Yet some Hoegaarden drinkers say the flavor of the beer changed.

“I think now it’s not as distinctive tasting,” says Iain Loe, spokesman for the Campaign for Real Ale, an advocacy group for pubs and beer drinkers. “You often see when a local brand is taken over by a global brewer, the production is raised a lot. If you’re trying to produce a lot of beer, you don’t want a beer that some people may object to the taste of it, so you may actually make the taste a little blander.” (Vallis’s response: “The brand’s commitment to quality has never changed.”) Despite occasional setbacks, Brito’s assiduous focus on the bottom line produced the intended results. InBev’s earnings margin (before taxes and depreciation) rose from 24.7 percent in 2004 to 34.6 percent in 2007. Its stock price nearly tripled. Then he started running out of things to cut. In early 2008, InBev’s results plateaued, and its shares stumbled. Investors hungered for another deal. Brito complied with the takeover of Anheuser-Busch.

He had intimate knowledge of his target: America’s largest brewer had distributed InBev’s beers in the U.S. since 2005. Anheuser-Busch’s CEO, August Busch IV, the fifth Busch family member to run the company, was no match for La Máquina and his mentor, Lemann, who was now an InBev director. Anheuser-Busch’s board of directors accepted InBev’s bid of $70 a share on July 14, 2008. A triumphant Brito promised that AB InBev would be a global brewer with three worldwide brands—Stella Artois, Beck’s, and Budweiser. “We respect Anheuser-Busch, its brand, what it did for the business, the people of AB,” Brito said in a video interview with Belgium’s De Standaard. “We think it just feels great to be here now and look at this combined company. There are so many things we can do.” For a number-crunching manager like Brito, an old, family-run company like Anheuser-Busch provided plenty of opportunities for cuts.

He laid off approximately 1,400 people, about 6 percent of the U.S. workforce. He sold $9.4 billion in assets, including Busch Gardens and SeaWorld. AB InBev also tried to save money on materials. It used smaller labels and thinner glass for its bottles. It tried weaker cardboard for its 12-packs and cases. The old Anheuser-Busch insisted on using whole grains of rice in its beer. AB InBev was fine with the broken kind. “Our purchasing of rice has to do with how fresh the rice is, not whether it is whole or broken,” says Vallis. The company played hardball with vendors. Anheuser-Busch has long boasted that “beechwood aging” enhanced Budweiser’s flavor. One of its two suppliers was Tom Urani, owner of Beechwood Corp. in Millington, Tenn. “In November 2008, we were featured in a nationwide ad,” Urani recalls. “It showed an aerial shot of our factory and said Anheuser-Busch is all about people, places, and quality.” After the merger, AB InBev informed Urani that it would use only one beechwood provider.

Urani was the losing bidder. He says this was the end of Beechwood Corp. Who else bought large amounts of beechwood chips but the makers of Budweiser? Urani threw a party on the final day. He invited Brito, who didn’t show up. That day, Urani drank his last Budweiser for the television cameras. “I’ve now become a bourbon guy,” he says. “I’ve lost weight.” AB InBev says it appreciates Urani’s years of service. Brito was just as ruthless when it came to the perks to which Anheuser-Busch employees had grown accustomed. He cut the number of BlackBerrys in half. Executives who once traveled in corporate jets now flew commercial. He removed the interior walls at One Busch Place in St. Louis and turned the office into an open-plan space. Everyone would work under the same Spartan conditions that Brito embraced. (In New York, Brito shares a large table with his head of sales and his finance chief.) “We always say the leaner the business, the more money we will have at the end of the year to share,” he said in a speech at Stanford in 2008.

“I don’t have a company car. I don’t care. I can buy my own car. I don’t need the company to give me beer. I can buy my own beer.” “Brito is a very candid and transparent guy,” says Keith Levy, a former Anheuser-Busch executive who was vice president of U.S. marketing after the merger before leaving the company in 2011. “It was easy to figure out where he was coming from, which wasn’t always the case with the Busch family. Don’t get me wrong, August III and August IV were both very dynamic and visionary leaders. There was just always a lot of theater and drama involved.” No matter how much you industrialize it, every can of beer starts as a living thing. It’s not like making soda. It’s more like bread, an agricultural product requiring cooking and fermentation with live yeast. That means a brewer spends a lot of time dealing with farmers. In this regard, Brito’s cuts were felt around the world. In the Hallertau region of Germany, small farmers had long made a living growing high-quality hops like Hallertauer Mittelfrüh, an integral component in Budweiser.

Budweiser, after all, was originally a Bohemian-style beer, brewed with European ingredients. Hops, a bitter kind of flower, provide the dry smack that rides atop the sugars in a beer. After the 2008 takeover, however, AB InBev said it was cutting its purchases of the Hallertauer hops. “They announced they were no longer going to use the Hallertauer Mittelfrüh variety,” says Johann Pichlmaier, president of the Association of German Hops Growers. “We’ve had to reduce the acreage in the past few years.” Martin Bauer, a sixth-generation hops farmer in Hüll, isn’t so busy these days. He putters around his barn in a flannel shirt and overalls. He keeps his farm going more to stay busy than for the money, which isn’t what it used to be. Bauer remembers meeting August Busch III, who came to the area once a year with a Mercedes-driving entourage. He fondly recalls how the former Anheuser-Busch CEO paid a high price for Hallertauer Mittelfrüh.

He has nothing good to say about AB InBev, which, he laments, is brewing its beer with cheaper, less flavorful hops. “As long as people buy the beer they brew, they won’t go back,” Bauer says. “The Chinese and the South Americans prefer lighter beer anyway.” Erna Stanglmayr is even more doleful. She says AB InBev is killing small hops farms like the one she’s run with her husband for 35 years. She predicts AB InBev will pay for its penny-pinching. “When you try to save money on hops, your beers will have less taste,” warns Stanglmayr. “Eventually, they will realize customers want quality beer.” In a telephone interview from Munich, Willy Buholzer, AB InBev’s director of global hops procurement, cheerfully insists that the company still brews the traditional way with Hallertauer Mittelfrüh. He says the reason that AB InBev stopped buying it was that it has a surplus. “We just have too much right now,” Buholzer says.

“We need a break for a couple of years.” A former top AB InBev executive, who declined to be identified because he didn’t want to get in trouble with his old employer, tells a different story. He says the company saved about $55 million a year substituting cheaper hops in Budweiser and other U.S. beers for more expensive ones like Hallertauer Mittelfrüh. It is hard to say whether the average Bud drinker has noticed. But then, the average Bud drinker is not drinking as much beer. As far as investors are concerned, Brito’s performance has been masterful. So much cash flowed in that by 2011 the company was able to pay down early a significant portion of the $54 billion it had borrowed to finance the Anheuser-Busch takeover. This triggered $1.3 billion in stock-option bonuses for Brito and 39 other executives that year. Often when a company has a year like that, executives take a victory lap. Their public-relations teams arrange for them to appear on the covers of business magazines and tell the inside story of how they achieved their success. Brito kept his head down.

He had little to gain by discussing his boyhood in Brazil. That wouldn’t sell many Budweisers in America. And it wasn’t the AB InBev way. There was another reason for Brito to be reticent. He’s been running AB InBev’s business in the U.S. like a private equity investor. He has increased revenue and profit, but he has done so almost entirely by raising prices and cutting the cost of making the product. This has done wonders for AB InBev’s balance sheet. “If you look at what AB InBev has done since it took over Anheuser-Busch, it has made it enormously more profitable,” says Trevor Stirling, a beer industry analyst at Bernstein Research, who detects more than a little xenophobia in the criticism of the company. “Is that un-American? Is it unconstitutional to increase the profitability of a business?” But the price increases have also weakened thirst for Budweiser and Bud Light in their country of origin. Bud Light shipments in the U.S. declined 3 percent to 39 million barrels from 2009 to 2011, according to Beer Marketer’s Insights. Bud slipped 13 percent.

Anheuser-Busch’s shipments were rising before the InBev takeover, according to Beer Marketer’s Insights. Benj Steinman, president of Beer Marketer’s Insights, says the trade-off of higher profits for lower volume is an acceptable one for AB InBev. “I think they are happy with their pricing strategy,” he says. “By and large, it’s done exactly what the company has wanted it to do.” Paul Chibe, AB InBev’s head of U.S. marketing, says Budweiser is “on fire” overseas. He also says that in 2011, 44 percent of Bud sales were outside the U.S., compared with 28 percent three years ago, and that the company is working hard to revive sales in the U.S. “People have an expectation of an instant turnaround,” Chibe complains. “That’s not a realistic expectation. It’s going to take years.” Brito’s attempts to wring dollars from other strong brands, such as deciding to brew Beck’s and Bass in the U.S., have also met disapproval. Beck’s isn’t doing well.

And, according to Bump Williams Consulting, sales of Bass in food stores fell 17 percent in the four weeks ended Sept. 9, 2012, compared with the same period in 2011. “They are hurting these brands,” says Gerard Rijk, a beverage analyst at ING. “The authenticity of Beck’s is that it is a German brand with German water, with German malt, with German hops. This isn’t about brand building. It’s about costs. Full stop. Heineken would never do such a thing.” AB InBev doesn’t see what the fuss is about. Chibe says the company hasn’t altered the ingredients of either beer. So why are customers rebelling? “You know, it could be that they are getting fresher beer, and they’re getting used to that,” he offers. “We are very, very disciplined as brewers. We’re committed to quality.” AB InBev continues to make changes to hallowed brands and try the patience of traditionalists with inventions like Michelob Ultra Dragon Fruit Peach.

Earlier this year, it inspired tabloid newspaper outrage in England when it reduced the alcohol content of Stella Artois, Budweiser, and Beck’s from 5 percent to 4.8 percent. “Brits historically have drunk relatively low-alcohol beer by American standards,” says Bernstein Research analyst Stirling. He applauds the AB InBev decision, noting that the version with lower alcohol saves the company money because taxes in Britain are levied by alcohol content. For its part, the company claims the move was “another example of our commitment to customer focus.” AB InBev is taking a similar approach to Goose Island, a small but respected Chicago brewery it bought in 2011 to combat the growing craft beer threat. Three months after the deal, AB InBev started brewing Goose Island signature 312 Imperial Pale Ale—named after a Chicago area code—in Baldwinsville, N.Y., where the area code is 315. Graham Haverfield, beer director at the Wine Library in Springfield Township, N.J., says he’s received an IPA made in Portsmouth, N.H.; a harvest ale made in upstate New York; and Belgian-style beers from Goose Island’s Chicago brewery.

This creates problems for Haverfield. “If I’m asked upfront by a customer, ‘Have you had this?’ Well, I don’t know,” he sighs. “The last time I had it, it was brewed in a different place.” He’s still a Goose Island fan, but he doesn’t know what AB InBev is doing with it. “I have a problem with a craft beer like Goose Island being treated like a mass-produced brand,” Haverfield says. “It’s a slippery slope.” Vallis disagrees: “We want Goose Island to grow in a way that’s right for the brewery and the brands.” Brito is fond of saying he has delivered on his promises to cut costs and pay down debt. Sometimes, he overdelivered. But this has put him in a bind. Once he was done with his latest round of merging and acquiring, shareholders started paying more attention to AB InBev’s declining market share in the U.S. The company’s shares swooned during much of 2011. In January, AB InBev released Bud Light Platinum, its first major new beer in the U.S. since the takeover. It comes in a sleek blue bottle and has nearly 2 percent more alcohol than its mother brand.

It’s also more expensive. AB InBev celebrated the beer’s launch with a happy hour on the floor of the New York Stock Exchange. Brito’s message to Wall Street was clear: We’re addressing our deteriorating U.S. position. AB InBev followed up in April with the rollout of Bud Light Lime-A-Rita, targeted at young women who prefer hard liquor. Never mind that it killed a similar product three years ago called Tequiza. “It failed miserably,” says Mike Mazzoni, a beer industry consultant. “It just didn’t taste good.” AB InBev says it learned a lot from the Tequiza experience. The most important business stories of the day. Get Bloomberg's daily newsletter.

5 Reasons Not To Miss The Leuven Innovation Beer Festival 5 Reasons Not To Miss The Leuven Innovation Beer Festival 10/06/2015 · by Breandán Kearney · in Beer , Breweries , Festivals & Events There is a long list of interesting beer festivals in Belgium ( see here ) and the Leuven Innovation Beer Festival – a new Leuven beer festival conceived by Brouwerij Hof Ten Dormaal and set in the unique venue of De Hoorn – is certainly a worthy addition to that growing list. The inaugural festival – which took place on Sunday 24 and Monday 25 May 2015 – came to fruition over just a matter of months in the face of no small measure of adversity and featured a diverse range of breweries from Europe and America for the celebration of ‘innovation’ in beer. LEUVEN INNOVATION BEER FESTIVAL According to the organisers there will be a second edition next year, so watch our video above to find out what to expect and check out the 5 reasons below you shouldn’t miss this special event. 1.

IT’S A ‘PHOENIX FROM THE ASHES’ STORY The Leuven Innovation Beer Festival – just like the brewery that organised it – is a real ‘phoenix from the ashes’ story. In order to make the Hof Ten Dormaal farm more profitable, the Janssens family started a brewery onsite at the beginning of 2009. On 6 January 2015, however, disaster struck. The brewery suffered a fire and the entire bottling line, conditioning rooms and most of the stock were burnt to the ground. Fortunately, much of the other brewing equipment was salvageable and after a rallying of the beer world by way of a public crowdfunding campaign and some assistance with production, Hof Ten Dormaal were able to get back on their feet and start brewing again. This is a brewery that’s keen to look forward and not backwards. Jef Janssens – whose father André and brother Dries brew with him at the farm – would prefer to focus on opportunity in the future rather than to dwell on the tragedy of the fire. “We were thinking about doing a festival for quite some time, but never in concrete ways,” says Jef.

“Right after the fire at our place, we felt let’s just do it. Now the time is right. We’ve got quite a lot of attention. We want to do something unique in Belgium.” Their brewery is already quite unique in that it grows its own hops and malt on site. The brewing water they use comes from their own well. Anything not used in the brewing process is recycled back into the farm to feed the livestock. They have grown from a small farm brewery to a respected creator of new flavours (including a chickory beer, various interesting seasonals and barrel aging projects). All over the world the beer market is exploding and we’re still clinging on to tradition. But Jef is concerned that Belgium will be left behind. “We think that the Belgian beer market is too common,” he says. “People believe we are still the best beer country, which is in my opinion not true at all. Americans make awesome beers. Italians make awesome beers.

All over the world the beer market is exploding and we’re still clinging on to tradition.” Attending the festival will afford you the opportunity to hear more about this rags to riches story from those who suffered the effects of the fire first hand and to meet with Jef and the other Janssens to see how the brewery – and the Leuven Innovation Beer Festival – have triumphed in the face of adversity. 2. IT’S PART OF SOMETHING BIGGER The Leuven Innovation Beer Festival is part of a greater scheme of events in the city. The City of Leuven have shown great foresight in having the Leuven Innovation Beer Festival close the ‘ Leuven Beer Month ’ and by including it as an integral part of their ‘ Leuven: the place to beer ’ programme of events. It’s important because it not only raises the profile of the festival but it also exposes those interested in the types of breweries and beers at the Leuven Innovation Beer Festival to other elements of the beer scene in the city, whether that’s one of the specially organised beer tastings, beer tours (including one on bikes) or brewery visits in the line-up.

To be part of Leuven’s programme of events is to contribute to the city’s diverse beer culture. Special tours of the Stella Artois brewery bring large numbers of visitors to the city to see one of the biggest beer operations in the world and festivals such as Zythos Beer Festival show off the complete spectrum of Belgian brewing. On the other hand, tours of breweries such as De Vlier and De Kroon shine the spotlight on those local to Leuven. Events like the Leuven Innovation Beer Festival allow those in Belgium to enjoy first-hand contact with international breweries such as Freigeist Bierkultur and Brouwerij Kees who they might not otherwise see. 3.THE JANSSENS FAMILY If many of the breweries signed up to the festival to show their support for Hof Ten Dormaal in the wake of their fire tragedy, then they were rewarded enormously with the hospitality of the brewery’s farming family, the Janssens: André and Mol and their sons Jef and Dries, their daughter Lisa, her husband Stijn and their two children. I find that the Hof Ten Dormaal family is one of the most genuine, kind and gracious families I have met in a long time.

“I met André and the whole family two years ago when I was here visiting their brewery and I stayed in touch”, says Lauren Salazar, the Specialty Brand Manager, Blender and Sensory Specialist at New Belgium Brewing Company. “I find that the Hof Ten Dormaal family is one of the most genuine, kind and gracious families I have met in a long time.” Surprisingly, New Belgium were pouring at a festival in Belgium for the very first time at the Leuven Innovation Beer Festival and given their positive experience, it likely won’t be their last. It was testament to the people skills of André Janssens and his family that they succeeded in organising a festival which afforded the brewers the opportunity to really get to know one another. “I think the greatest part of this festival is that not only have André and his family made us feel part of their family, but having met the brewers only two days ago, we’ve become like a small community among ourselves in a very short period of time”, says Lauren. Unlike other festivals where those pouring rarely get a chance to see each other, brewers here were able to walk around to each other’s booths, catch up, share a beer and have a chat. “It’s strange”, says Lauren.

“In just a couple of days, I’m going to miss everyone.” It’s intimate and relaxed enough that you too will be able to meet the Janssens at the festival and enjoy the hospitality for which their family is known. 4. IT’S IN THE PERFECT VENUE It’s highly appropriate that a festival celebrating innovation takes place in a venue with so much historical significance to Belgian brewing: De Hoorn. It was here in 1926 that Stella Artois was brewed for the very first time. Visitors entered the festival through this old brewing room, past the mash tuns, filter vessels and brewing kettles before descending into the beautifully redecorated De Hoorn café. The venue was a major talking part for those in attendance at the festival. This is perhaps because it offered a stepping stone between the beer worlds of the past and the future but also represented a kind of symbiosis between the growing ‘craft’ scene and the world of Belgian macro-brewing, highlighted best by the fact that one of the stars of the festival – Goose Island brewery – was acquired by AB Inbev in 2011.

With a lot of UK festivals, it’s impossible to try a quarter of the beers, but this is so intimate. “The venue is stunning,” says Steve from UK brewery, Siren Craft Brew. “I was chatting to a guy earlier who said it went through a refurbishment and it used to be worn down and was not particularly a nice place. But I love the intimacy of it. With a lot of UK festivals, it’s impossible to try a quarter of the beers, but this is so intimate. They’ve organised it really well in the sense that we got to meet all of the brewers and it’s easy to try one beer from each stall and that’s the whole point.” The Leuven Innovation Beer Festival affords you the opportunity to come along and experience this venue for yourself while drinking some unique beers. 5. THE THEME OF INNOVATION The theme of the festival is innovation and the chance to try beers which are new – whether it relates to the ingredients, the techniques used, the production process, the energy used, the packaging or even the origin of the recipe – is as good a reason as any for you not to miss this festival.

There’s certainly no shortage of interesting ideas and flavours in the beers pouring at the festival: Swedish brewery, Brekeriet were causing quite a stir with their ‘Sour & Salt’, a beer which does exactly what it says on the tin. NØgne Ø brought a Norwegian-Ozzie collaboration in ‘Aurora Australis’, an abt / quadrupel style beer of 11% ABV which was brewed by Bridge Road Brewers in Australia and matured in red wine barrels during its long journey to Norway where Nøgne Ø carried out the blending and packaging. The Americans also made telling contributions: New Belgium poured the Transatlantique Kriek, a blend of their own blonde and the Oud Beersel Oude Kriek; while Goose Island ensured a scramble at their booth by opening a few bottles of their big powerful imperial stout, Bourbon County Brand Stout. We don’t really care about what the market is saying or what way it is leaning or whatever. We make beers the way we like it. The Dutch were there too. John Brus from De Molen believes that innovation comes naturally when you’re doing something you want to do. “The way we do it is the way we like it,, he says.

“That’s the thing. We don’t really care about what the market is saying or what way it is leaning or whatever. We make beers the way we like it.” For De Molen, being innovative is a direct result of trying new things with taste. “There are so many flavours to discover and I think that’s important”, says John. “You see some changes in the consumer’s behaviour. Now instead of going for the big one or the cheap one, more and more people are trying to discover flavours.” Bradley Cummings from Tiny Rebel Brewery in South Wales was also impressed with how Belgium was embracing innovation through the festival. “I think Belgium has got one of the oldest traditions of beer and when you see them trying to innovate and do something different it really says something about the way the market is going,” says Bradley. “It’s what people want. People don’t want to drink the same thing all the time. And as you can see with the 16 different breweries here, every brewery has got its own story, its own style of beer, its own location. It’s great when you can all get together from different walks of life.” Here's some other stuff:

Question: Stella Artois originates from which Belgian city, the name being shown on its bottles and cans?
Answer: Leuven